United Spirits lost 2.71% to Rs 2598.15 at 9:17 IST on BSE after a division bench of the Karnataka High Court on Friday declared United Breweries (Holdings)' stake sale in United Spirits to UK-based spirits giant Diageo null and void.
Meanwhile, the S&P BSE Sensex was up 93.35 points or 0.44% at 21,173.07.
On BSE, so far 19,000 shares were traded in the counter as against average daily volume of 2.49 lakh shares in the past one quarter.
The stock hit a high of Rs 2,622 and a low of Rs 2,511 so far during the day. The stock had hit a 52-week low of Rs 1,708.20 on 5 April 2013. The stock had hit a record high of Rs 2,815 on 18 July 2013.
The stock had outperformed the market over the past one month till 20 December 2013, surging 8.08% compared with the Sensex's 2.15% rise. The scrip had also outperformed the market in past one quarter, jumping 5.3% as against Sensex's 4.03% rise.
The large-cap company has equity capital of Rs 145.33 crore. Face value per share is Rs 10.
A division bench of the Karnataka High Court on Friday, 20 December 2013, declared the United Breweries Holdings (UBHL)'s stake sale in United Spirits (USL) to UK-based spirits giant Diageo null and void. The court passed the ruling while admitting an appeal against the USL-Diageo deal by creditors of UBHL. The court said the deal is void until a conclusion is reached on the winding up petitions against UBHL.
The court also asked Diageo to return the shares bought from UBHL as the company is mired in a whirlpool of winding-up petitions by creditors, who are seeking recovery of unpaid dues of close to Rs 600 crore from Vijay Mallya's firm.
Last year, Diageo had announced that it would pick up 53.4% stake in USL in a multi-structured deal for a total of Rs 11,166.50 crore. As part of that deal, 26% shareholding was to be acquired through an open offer.
After Kingfisher Airlines defaulted on its loans, several creditors such as BNP Paribas had dragged UBHL, the corporate guarantor for the liabilities, to court and had filed a winding-up petition.
USL and Diageo said they would take steps to protect their interests after the Karnataka High Court declared as "null and void" the sale of shares of the Indian firm by its holding company to the UK-based giant. "We will take all necessary steps to protect Diageo's interests as well as our own," UB Group Chairman Vijay Mallya said.
Diageo said that only part of the 26% stake it now owns in United Spirits is affected by the court's decision. "We do not believe that there are any grounds for declaring the sale of the [6.9% of] shares in United Spirits purchased by Diageo on 4 July 2013 from United Breweries (Holdings) as void." the company said in a statement. "We are disappointed to hear that the court has overruled the previous order of the High Court of Karnataka," which approved the share sale, it said
United Spirits' net profit surged 140.1% to Rs 94.27 crore on 8.2% decline in net sales to Rs 2038.66 crore in Q2 September 2013 over Q2 September 2012.
United Spirits is the largest alcohol beverage company in India, having sold 123.70 million cases in the year ended 31 March 2013.
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